Application to vary the Vehicle Repair, Services and Retail Award 2020

In the matter of an application by the Automotive Holdings Group, a large Australian motor vehicle dealership, the Australian Industrial Relations Commission was asked to vary the Vehicle Repair, Services and Retail Award 2020. The applicant sought changes to the award to allow for reduced working hours and a reduction in employee wages during the COVID-19 pandemic, arguing that the pandemic had resulted in a significant reduction in business and an inability to meet the current award's terms. The respondent, the Automotive Retail and Service Workers Union, opposed the application, contending that any changes to the award would undermine the protections afforded to employees by the modern awards system.

The primary legal issue before the Commission was whether the application met the criteria for an award variation under the Fair Work Act 2009. Specifically, the Commission had to determine if the application satisfied the modern awards objectives set out in Schedule 1 of the Act, and if the variation was necessary to achieve those objectives during the pandemic. The Commission also had to consider whether the proposed changes to the award would result in a significant detriment to the employees and whether there were any alternative means of achieving the same outcome without resorting to an award variation.

In its decision, the Commission found that the application met the criteria for an award variation under the Fair Work Act. The Commission held that the pandemic had resulted in exceptional circumstances that justified a departure from the usual terms of the award. The Commission also found that the proposed changes to the award would not result in a significant detriment to the employees and that there were no alternative means of achieving the same outcome. The Commission noted that the application was consistent with the modern awards objectives and that the variation was necessary to ensure the continued operation of the business and to protect jobs during the pandemic. The Commission therefore granted the application and varied the award accordingly.

The final orders of the Commission included a reduction in the minimum weekly hours for employees from 38 to 32, and a corresponding reduction in wages. The variation also allowed for the possibility of further reductions in hours and wages if the pandemic situation warranted it. The variation was to be in effect from 1 July 2020 until 30 June 2021, or until such time as the pandemic situation had improved to the extent that the usual terms of the award could be reinstated. The Commission also ordered that the applicant provide written notice to affected employees of the variation and any further changes to the award.